Abstract
The proposed carbon peak and carbon neutralization goals have ushered China into an era of emissions reduction and a climate-oriented economy. With the proposed double carbon goal, China has formulated many environmental protection and green credit policies. This paper aims to assess the impact of corporate environmental performance (CEP) on financing costs, using a panel dataset of companies in China's heavily polluting industries from 2010 to 2019. We employed fixed-effect models, moderating-effect models, and panel quantile regression (PQR) to analyze the impact, underlying mechanisms, and asymmetric features of CEP on financing costs. Our results indicate that CEP has an inhibitory effect on financing costs, with political connections strengthening this effect and GEA weakening it. Moreover, the impact exhibits asymmetry at different levels of financing costs, wherein lower financing costs see a greater weakening effect from CEP. Improved CEP helps to optimize the financing performance of companies and reduce financing costs. Therefore, policy makers and regulatory authorities should work to unblock financing channels for companies, encourage environmental investment, and remain flexible in implementing environmental policies.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.